Kaufman and three other county school districts are caught in a dispute with the state comptroller’s office that could cost them more than a million dollars in revenue.
Even though property appraisals in the county, including the districts, have skyrocketed, the comptroller’s office says the values are still too low.
The county appraiser and the Kaufman, Kemp, Terrell and Wills Point school districts are appealing the state’s findings. They should hear the outcome in May.
“This is not anything in our hands,” said Todd Garrison, Kaufman ISD’s chief financial officer. “It affects us but we don’t have control over those numbers.”
The district gets its property values from the county appraisal district to set the tax rate and budget. The state also does an appraisal, and if it finds the appraisal district’s numbers too low it can withhold state revenue.
The district receives about 65 percent of its funds from the state.
Kaufman County Chief Appraiser Sarah Curtis said she is confident the county numbers are correct.
For the Kaufman district in 2019- 2020, the appraisal district set a total taxable value of $950.6 million. The state valued the property at $1.01 billion, more than a 10 percent difference specified in state law.
In 2018, the county value was $767,335,995 and the state value was $827,382,113.
There was also a difference in 2017.
The preliminary Kaufman ISD valuation for 2020 is $1.1 billion.
In 2017, seven of the county’s nine districts were not in state compliance. Three of the seven now meet the state standard.
The state has a two-year grace period allowing the districts to use the county values but now will use the state values to determine state aid.
“We could potentially lose close to a million dollars,” Garrison said.
He said he doesn’t anticipate the district will have to cut programs or staff.
“The district has a fund balance; it could come out of that. Also, we try to budget conservatively,” Garrison said.
Curtis said problems began when the comptroller’s office began using a third-party to do evaluations.
She said she believes the company is using the same values for the whole county, even though conditions vary between different parts of the county.
“Can you believe they raised a little old house in Kemp 86 percent,” she said.
State Rep. Keith Bell, who represents Kaufman and Henderson counties, said he’s concerned the state doesn’t see the north-south divide in country property values.
“Commercial property isn’t worth the same in downtown Kemp as the same kind of property across the street from Buc-ee’s.”
In a written statement, the state comptroller’s office said it does account for the differences in values across the county.
“We work to identify these market differences by communicating with the appraisal district, reviewing market data, and in some cases, traveling to the county to review,” the statement said.
Curtis said she uses the same type of data.
Appraisals are not based solely on a property’s sale value. Appraisers look at revenue from property and, in the case of leased property, the cost of the lease, among other factors.
She said her office may be forced to buy data from the company doing state appraisals.
To make matters worse, the comptroller’s appraisals are out of
step with the school district’s budgeting process.
The district receives county appraisals during the summer, formulates a budget and approves a budget in the late summer.
The budget is based on the revenue the district expects to raise from local taxes and state, federal and some other funds.
But the state doesn’t send its appraisals until January. That means the district can find out then that it is going to receive less state money than anticipated, Garrison said.
“We’re in the middle of the year and we don’t even know how much we are going to get,” Garrison said.